Three Options, One Profitable Path

Cliff Street was a house they already owned. It was tired, tenanted and in the wrong spot, and frankly, they did not want another project. Here is how they ran the options, chose the one that stacked up, and let go of ‘perfect’ to get it sold.

PROJECT 35 Cliff Street, Brunswick

DEVELOPER BuildHer Collective

ARCHITECT OB Architects

JOINERY Made by Laminex

BUILDER Berin & Co.

PHOTOGRAPHY Dylan James

They bought Cliff Street years ago, back when the block was in fact zoned industrial. Over time, the zoning changed, the tenants stayed and the house got tired. When it finally came time to sell, they did what Rebeka teaches: they ran the options and let the numbers choose.

Rebeka called the project QuickStrate, because the strategy was straightforward: work with what they already owned, keep it clean and functional, and sell for a profit. Nothing about it was their dream home, and that was the point.

Here is how it went, in their words.

The tired, tenanted house.

Cliff Street was never an easy site. It sits on a laneway in Brunswick, faces south, has a small backyard and overhead lines out the front, and it is close to what used to be industrial land. Rebeka had the house rented out for years. By the time she walked through with fresh eyes it was tired, smelly and in need of real work.

Rebeka had run the numbers on a dual occupancy long before this, and the return was not there, so she left it alone.

Then life forced the question. Rebeka needed an office near the kids’ school after the move to Panton Hill, and the studio she was subleasing was about to be sold. The owner agreed to rent it to us for a year and then sell it to us, which meant we had to find the money. We looked at John’s factory first, but commercial property can be the better long-term hold, and it was Rebeka’s sister who asked the obvious question. What about Cliff Street?

To be honest, she did not want another project. Rebeka’s workload was already full, the house was a twenty-five-minute drive from home, and John was living and working at the vineyard in Gippsland. But we had a need to sell, and that meant the decision had to come from what the numbers said, not from what we wanted to happen.

Three options and how they chose

What was owed on Cliff Street was roughly what the house was worth in that market. That is the starting point for every option, and it is why the first one hurt.

Option one: move the tenants out and sell as is. A clean-up, no styling and minimal spend, so fast and cheap, and it would have appealed to bargain hunters only. The feasibility came back as a loss, because we would have had to put money in just to pay out the loan and settle. Minimum upside, given the location.

Option two: renovate inside the existing walls. New kitchen, bathroom and laundry, a repaint, a tidy garden, a deck and stairs, on a lean budget with a turnaround of two or three months and very little paperwork. It came back as a profit, but a thin one. Any cost blowout would have wiped it, and we would still have been selling a house with a floorplan, a flow and a location of limited appeal.

Option three: renovate and extend. Gut and refresh the existing house, then add a rear extension with open-plan living, a master suite, a deck and landscaping. The best product for the market, the strongest appeal to family buyers and the most resale certainty. It cost more, took longer and needed more management, and the location was still the location. It was also the only option with a real profit in it.

They ran the third option several times, each time asking how we could do less. The architect’s first plan put the master at the front of the house, which meant reworking too many walls and replastering most of the rooms, so out it went. Every pass trimmed the scope until the work matched the return.

Once the three sat side by side, the decision was clear. One lost money, one barely scraped a profit, and one had meaningful upside. So the question changed, from whether we would take it on to how we would deliver it alongside everything else. That is when we brought our sons into the conversation.

We aren’t in the business of creating the perfect house. We’re in the business of delivering profitable projects.

The box on the back

Rebeka worked with OB Architects to design a cost-effective “box on the back”: a rear extension that opened up the house and created the family spaces buyers in this area were looking for.

The kitchen, dining and living became one open-plan room, the master suite went at the rear, and buyers still read it as a retreat. The mudroom and laundry turned out to be the most talked-about feature at inspections. Who would have picked that?

For finishes we kept it warm without spending big, with natural materials, playful colour washes and texture doing the work. The joinery is Made by Laminex.

What went wrong and what was let go

Plenty went wrong. Council held us up on Report and Consent for far longer than was planned, and the drawings took longer to finalise than expected. They were on site after hours and on weekends, so progress was slow. Then, two weeks before completion, Rebeka’s son had a health scare, and finishing and styling stopped for six weeks while family came first.

From beginning to sale, the project took close to two years, so much for quick.

And then there is what we let go. The kitchen handles we wanted sat in a box in the garage, and they stayed there, because Rebeka was not going to spend more on something only she would notice. The family bathroom was small, there was no bath and the master was not at the front. None of it stopped buyers from seeing value.

Perfection is expensive, and it doesn’t guarantee profit.

The biggest shift was to stop building the project in our own heads and start seeing it through the eyes of the buyer. We listened to the agent, adjusted our expectations and let go of our story about what the house “should” be worth. Despite every objection about the location, six buyers were engaged through the campaign and five were bidding on auction day. The house sold for a real profit.

What Rebeka would tell you

Feasibility is a decision-making tool you come back to every time the project gets busy or emotional, and this one got both. It is never a box you tick at the start and forget, and when we felt lost we went back to the numbers.

Run every option, including the one you do not like. Selling as is felt easiest, and it was the one that lost money, and you only know that by writing it down. What do the numbers say?

Design for the buyer in front of you, not the home in your head. Ask what a family in this street wants, then give them that, and let the kitchen handles stay in the box.

Trust your agent, because they are looking at the market, while you are looking at your own project through two years of effort. That is a different view.

And let the project be the project. Cliff Street will never be the perfect house, but it was a profitable one, and that is the business we are in.

Cliff Street reminded us that the process works on our own projects too, even the ones we did not want. Two questions got the house sold: what do the numbers say, and ok, so what should we do about that?

Feeling inspired by the Cliff Street project and want to start your own, or thinking about renovating for a profit? We’d love to help you! Book a chat with us today.